what more can you ask for?
That brings up the topic again of how best do use their cash. Pay a special dividend, stop paying a divi altogether for now, buy back stock, hold on to it in the event an opportunity to diversify presents itself? Those are the things Preisslor and Co. are figuring out as they plan for 2014 and beyond. I'd rather see them stop the divi for now and buy back more shares.
I was lucky enough to be watching last week when MPEL fell below $37 and scooped some up. Really happy with that buy to add to my position.
I'd love to see them authorize a $10M buyback program unless they have a better use for the cash.
I don't know what all the fuss was about today. Your post shows all the negatives have been out there a long time for anyone paying attention.
If credit VIP isn't coming back, and there is no reason to think it is, then they need to do something with the $250M+ they have since they definitely aren't using a lot of it to run the business.
Does anyone remember Jan was off to a really strong start? I do. The early numbers indicated a higher growth rate than originally expected. So I think the lower rate was due to the outsized effect of CNY. We are getting a buying opportunity here.
It really surprises me how volatile hold is. I looked at LVS' report the other day and while everyone was focused on the hold in Singapore it was also low in a couple of the casinos in Macau. Like below 2% low. Surprising with the size of their operation. But that is why they include "hold adjusted" numbers in their releases so people get an idea of what things would have looked like under normal conditions. Anyway it's good to see hold make up for the lousy Q4 rate.
Junkets reported a slowdown at the end of the month so don't get your hopes up on RCT.
As far as the value of the predominantly cash play rooms wouldn't the fact that the margins are thinner effect the value? The price paid for the room is going to reflect the return on capital and that return is lower in the cash rooms so their value is capped.
The smaller junkets are the types of operators that IKGH has acquired. With 5 rooms and 40 tables it is at least a mid-tier level company.
Really getting mixed signals. M&A in the space picking up at the same time roll may be on the decline due to side betting. Plus junket's margins are getting squeezed. The side betting will also hurt the casinos, is illegal, and so maybe they will try to step in to do something about it. Macau could start to be a less attractive place for junkets to operate as more options open up like Japan. There's an article by Pisani on CNBC's site talking about the credit crunch in China hurting small business which is getting recognized by the government. It could be why the government injected so much cash in the system last week. A lot of stuff going on here. I would say most of it not good for Iao Kun. They couldn't have picked a worse time to list.
I get how they have this formula for deciding if using money to buy stock is accretive according to how much return they are getting from their cash in the cage. But if they are going to keep 30-40 million on the sidelines I say screw the formula and get aggressive on a buyback. Buy 10 million shares and drop the darn count down to 55 million.